LATEST ON ACA REPEAL AND REPLACE – February 15, 2017

Eye on Washington – February 15, 2017LATEST ON ACA REPEAL AND REPLACE

ACA Repeal/Replace: Moving Fast or Slowing Down?

House Freedom Caucus and select conservatives are offering a new approach to leadership on advancing ACA repeal and replace. They hope that this approach, with enough member support, could breathe new life into Republicans’ top legislative priority before it bleeds into the second quarter and risks derailing the rest of their robust agenda for 2017. As a result of their discussions, House Freedom Caucus Chair Mark Meadows (R-NC) recommended Leadership advance the 2015 reconciliation package that cleared the Senate and was sent to President Obama in early 2016 within the next 30 days. The goal being robust repeal now as the only option and letting replace either be initiated by Senate amendment or via an FY18 budget reconciliation process.

Additional reactions:

Move repeal of ACA in the House ASAP* – HR 3762 previously cleared the Senate, so why shouldn’t a similar repeal bill move again? Republicans want to show progress on repeal/replace promise without getting bogged down by simultaneous replace policy challenges. The fear is that they are losing momentum and this is the way to jump start it and possibly bring Dems to the table on solutions.ASAP* – Could be as soon as the President’s joint session on February 28

Go beyond HR 3762 – Build on previous effort that removed Medicaid expansion, ACA subsidies, and taxes, and take it a step further by repealing individual and employer mandates, along with insurance regulations.

Consider replace in a piecemeal format or via FY18 reconciliation package in concert with tax reform – Leadership continues to view replace in four buckets: (1) Health savings accounts (HSAs); (2) tax credits; (3) high risk pools; and (4) Medicaid reform. Progress is being made on the legislative text and CBO scoring of replace components, but changes to Medicaid remain the lynchpin for many members in expansion states.

Play legislative “hot potato” with the Senate – Conservatives hope that this will put pressure on Senate colleagues to engage faster by letting them add replacement policies that can get 50 votes and pass muster with the Senate Parliamentarian. The current risk being expressed by House members is that the House leads and the Senate does not follow, leaving them politically vulnerable.

But how many members would abandon replace and support this? – Freedom Caucus claims that as many as 50 House Republicans agree with their proposed approach. Whip counts on both sides have been inflated before on big votes, but leadership can still afford to lose 28 votes out of 246 on repeal and/or replace. Majority Whip Scalise continues to meet with members in small groups to gauge support for the Speaker’s approach.

What’s Next?

Scenario A: Leadership sticks with the plan. Committees will mark up legislation related to replacement components following the President’s Day recess with the goal of Budget Committee action by the second week of March. In coordination with the Senate, the pressure to act will prompt members to agree to advance legislation quickly on the floor and to the Senate before April 1. House GOP leaders began outlining the main planks of a replacement blueprint with rank and file members this week which will provide some assurance that the plan is on track. Senate dialogue has been ongoing, so as to minimize any procedural or policy hurdles, although it is very possible that Medicaid changes could be watered down or bifurcated at a later date.

Scenario B: Conservative members in both chambers could make the case that enough members would prefer a straight repeal for now, with the assurance of a quick, measured path to replacement in the months to follow. The emphasis being that if Congress doesn’t pass a repeal bill now, conservatives could lose momentum as lawmakers change gears to take up other must-pass priorities, including funding the government this spring. It remains to be seen whether or not this is just an inevitable exercise in leveraging the Freedom Caucus brand with Speaker Ryan. The approach could be more viable if leadership changes posture and committee work slows following the President’s Day recess. Expect some reassurances later this week in terms of discussion docs or announcing markups.

Today’s “We Don’t Knows”

Is Leadership Looking for a Way Out and Onto Tax Reform?

Where is Senate leadership on Repeal-Only?

Will the President’s Day Recess Have a Noticeable Impact on the Repeal End Game?

The E&C Republican Medicaid Task Force, led by Rep. Brett Guthrie (R-KY) completed its work in December. Since then, everyone has expected a release of some kind with speculation on varying format (e.g., recommendations, principles, white paper). Conference has been holding educational meetings for members this week, which is fueling much of the fodder. Expect a discussion document trial balloon as early as Friday for Medicaid overhaul concepts such as per capita caps. The document will dig a bit deeper than Better Way did but not offer legislative text.